Part 85

Resolved, That the arrearages of interest, on the Continental and State debts, ought to be funded, and consolidated with the principal.

Resolved, That the interest to be paid thereon does not exceed ---- per cent. per annum, for the present.

These motions were severally expressive of objects contemplated in the Secretary's report. The last was upon a principle of modification, such as was held out in the plan for reloaning the debt.

TUESDAY, February 9.

Public credit: Providing for the public debt: Assuming the State debts: Funding their certificates: Report of General Hamilton, Secretary of the Treasury.

Mr. JACKSON.--Believe me, Mr. Chairman, I have as high a sense of the obligation we are under to the public creditors, and feel as much gratitude towards them as any man on this floor. I shall ever cheerfully acknowledge the duty we owe to our benefactors, and in a peculiar manner to those brave soldiers who, at the risk of their lives and fortunes, secured the independency of America. I have also the most sincere wishes for the re-establishment of public credit, and that upon firm and solid ground, and on principles which cannot be called in question; but there appears to me a previous question, which has not yet been brought forward; it is this, whether there exists an immediate necessity for funding the national debt in the permanent manner proposed?

The high regard I have for the nature and circumstances of the foreign debt, induced me to let the first proposition pass without any animadversion. The vote which has been taken on that point will serve to show foreigners that we are concerned to preserve our credit with them by a rigid performance of our stipulations; trusting, at the same time, that our fellow-citizens cannot object to a distinction so just and proper in itself; for, notwithstanding what the domestic creditors may say, it is the money of foreigners that has, in a great measure, established our independence.

It is doubtful with me whether a permanent funded debt is beneficial or not to any country; some of the first writers in the world, and who are most admired on account of the clearness of their perceptions, have thought otherwise, and declared that wherever funding systems have been adopted in a Government, they tend more to injure posterity than they would injure the inhabitants to pay the whole debt at the time it was contracted. The principle, I apprehend, is demonstrated by experience; the first system of the kind that we have any account of originated in the State of Florence in the year 1634; that Government then owed about £60,000 sterling, and being unable to pay it, formed the principal into a funded debt, transferable with interest at five per cent. What is the situation of Florence in consequence of this event? Her ancient importance is annihilated. Look at Genoa and Venice; they adopted a similar policy, and are the only two of the Italian Republics who can pretend to an independent existence, but their splendor is obscured; they have never been able since the period at which a funding system was introduced to raise themselves to that formidable state to which they were before. Spain seems to have learned the practice from the Italian Republics, and she, by the anticipation of her immense revenue, has sunk her consequence beneath that level which her natural situation might have maintained. France is considerably enfeebled, and languishes under a heavy load of debt. England is a melancholy instance of the ruin attending such engagements. In the reign of King William, 1706, the policy of the English Parliament laid the foundation of what is called their national debt; but the sum was inconsiderable; it little exceeded £5,000,000 sterling; the example then set has been closely followed. In 1711, it amounted to £9,177,769 sterling, during the wars in the reign of Queen Anne; since that, the capital of the debt of Great Britain amounted, in 1777, to about £136,000,000 sterling; and to such a pitch has the spirit of funding and borrowing been carried in that country, that in 1786, their national debt had increased to £230,000,000 sterling; a burthen which the most sanguine mind can never contemplate they will ever be relieved from. If future difficulties should involve that nation still further, what must be the consequence? The same effect must be produced that has taken place in other nations; it must either bring on a national bankruptcy, or annihilate her existence as an independent empire. Hence I contend that a funding system in this country will be highly dangerous to the welfare of the Republic; it may, for a moment, raise our credit, and increase our circulation by multiplying a new species of currency; but it must hereafter settle upon our posterity a burthen which they can neither bear nor relieve themselves from. It will establish a precedent in America that may, and in all probability will be pursued by the sovereign authority, until it brings upon us that ruin which it has never failed to bring, or is inevitably bringing, upon all the nations of the earth who have had the temerity to make the experiment. Let us take warning by the errors of Europe, and guard against the introduction of a system followed by calamities so universal. Though our present debt be but a few millions, in the course of a single century it may be multiplied to an extent we dare not think of; for my part, I would rather have direct taxes imposed at once, which, in the course of a few years, would annihilate the principal of our debt. A few years' exertion in this way will save our posterity from a load of annual interest, amounting to the fifth, or perhaps the half of the sum we are now under engagements to pay.

But why, Mr. Chairman, should we hasten on this business of funding? Are our debts ascertained? The report of the Secretary of the Treasury proposes that we should not only fund the debts that are ascertained, but the unliquidated and unsettled debts due from the Continent; nor does the plan stop here, it proposes that we should assume the payment of the State debts--debts to us totally unknown. Many of the States, sir, have not yet ascertained what they owe; and if we do not know the amount of what we owe, or are to be indebted, shall we establish funds? Shall we put our hands into the pockets of our constituents, and appropriate moneys for uses we are undetermined of? But more especially shall we do this, when, in doing it, it is indisputably certain, that the encumbrance will more than exceed all the benefits and conveniences? Gentlemen may come forward, perhaps, and tell me, that funding the public debt will increase the circulating medium of the country, by means of its transferable quality; but this is denied by the best informed men. The funding of the debt will occasion enormous taxes for the payment of the interest. These taxes will bear heavily both on agriculture and commerce. It will be charging the active and industrious citizen, who pays his share of the taxes, to pay the indolent and idle creditor who receives them, to be spent and wasted in the course of the year, without any hope of a future reproduction; for the new capital which they acquire must have existed in the country before, and must have been employed, as all capitals are, in maintaining productive labor. Thus the honest, hard-working part of the community will promote the ease and luxury of men of wealth; such a system may benefit large cities, like Philadelphia and New York, but the remote parts of the continent will not feel the invigorating warmth of the American treasury; in the proportion that it benefits one, it will depress another.

Mr. SMITH, (of South Carolina.)--The report of the Secretary of the Treasury contains a proposition for the establishment of a sinking fund. I wish the gentleman who brought forward the resolutions under consideration, had included that part of the system in his propositions, as it might have had a tendency to ease the mind of the honorable gentleman from Georgia, and to have shown him that the public debt is not intended to acquire the permanency which he dreads. If our present debt cannot be paid off at once, all that can be done is to provide such funds for its gradual extinction as will morally ensure the object.

The gentleman has contended, that public funding is a public injury. I agree with him that funding a debt to a very great amount may be very injurious; yet funding a small debt is beneficial. But whether this is, or is not a fact, is not the object of our present inquiry; we are not in a situation to determine whether we will or will not have a public debt. We have it already, and it appears to me to be a matter of necessity that we should appropriate some funds for the payment of the interest upon it. When we consider the nature of the contract, for what it is we owe the money, and our ability to comply, it follows, of consequence, that we must pay; it follows as close as the shadow follows its substance; or as close as the night follows the day. The only question that can come before us is, the mode of doing it.

With respect to that part of our debt which is yet unascertained, I would just beg leave to observe, that it is not our fault that it remains in an unsettled state; neither is it the fault of those who have brought in their accounts and had them liquidated. Hence, it appears to me extremely hard that we should refuse to provide for the payment of those to whom we acknowledge ourselves to be indebted, because there are others whose claims against us are not yet adjusted. The argument, therefore, which relates to this point, as well as that which relates to the Western Territory, will apply ten years hence as well as now, and form an eternal pretext for deferring the business.

Mr. FITZSIMONS said, that the circumstances of the foreign debt were such as left no choice in our power, according to the plan proposed by the Secretary of the Treasury; but we have it in our power, and are recommended to make a different arrangement with respect to the domestic debt. I stated, when I introduced the resolutions, that they were intended to bring the Secretary's plan fairly before the committee. This resolution is differently worded on that account; but it may be observed, that the foreign creditors are not here to make a contract with the people of the United States, but the domestic creditors are; and we may hold out a modification to them for their acceptance. With respect to the means by which we shall be enabled to pay the interest and principal of our debt, this resolution has nothing to do, it leaves it to the consideration of the committee; and every gentleman will be perfectly at liberty to propose and support such as he supposes to be most suitable to our abilities.

Mr. LIVERMORE.--I do not clearly understand the import of the resolution before the committee. It seems worded rather in a doubtful manner. If it means, that funds ought to be appropriated for the payment of the interest and principal of the domestic debt, as the amount appears on the face of the certificates, I shall be totally against it; whether it pointedly carries that meaning or not, I cannot say.

For my part, I consider the foreign and domestic debt to carry with them very material distinctions. The one is not like a debt, while the other has all the true qualities of one. However gentlemen may think on this subject, there is a great difference between the merits of that debt which was lent the United States in real coin, by disinterested persons, not concerned or benefited by the revolution, and at a low rate of interest, and those debts which have been accumulating upon the United States, at the rate of six per cent. interest, and which were not incurred for efficient money lent, but for depreciated paper, or services done at exorbitant rates, or for goods or provisions supplied at more than their real worth, by those who received all the benefits arising from our change of condition. It is within the knowledge of every gentleman, that a very considerable part of our domestic loan-office debt arose in this manner. It is well known that loan-office certificates were issued as a kind of circulating medium, when the United States were in such straits for cash, that they could not raise the necessary supplies in any other way. And it is very well known, that those who sold goods or provisions for this circulating medium, raised their prices from six to ten shillings at least.

There is another observation I would beg leave to make. The prices at which our supplies were procured were such, even in hard money, that it might be said specie had depreciated, or, what amounted to the same thing, the commodities were sold for more than their current price; in many cases, half the price would now purchase the same thing. If so, there is as much reason that we should now consider these public securities in a depreciated state, as every holder of them has considered them from that time to this. There was a period at which they were considered of no greater value than three or four shillings in the pound; at this day they are not at more than eight or ten. If this, then, is the case, why should Congress put it upon the same footing as the foreign debt, for which they received a hard dollar for every dollar they engaged to pay? Could any possible wrong be done to those who hold the domestic debt, by estimating it at its current value? I do not speak of those only who have speculated in certificates. With respect to them, I do not see how a difference can be made. By the resolutions of Congress, and from the face of the papers, it appears that they were transferable.

It may be said, that there was some part of the domestic debt incurred by loans of hard money. There might be a small part lent in this way, but it was very small indeed, compared with the whole of the domestic debt. It is in the memory of every gentleman, that, before the beginning of the revolution, every State issued paper-money; it answered the exigencies of Government in a considerable degree. The United States issued a currency of the same nature, which answered their purposes, except in some particular cases, and these were effected by loans of certain sums of hard money. If any distinctions are to be made among the domestic creditors, they ought to be made in favor of such only, and that in consequence of the origin of the debt; while the great mass given for the depreciated paper, or provisions sold at double prices, ought to be liquidated at its real value. I cannot think it injustice to reduce the interests on those debts. I should therefore be against passing this resolution, if it carries in it the idea of paying the principal and interest, according to the face of the paper. It is well known, that a large proportion of this domestic debt was incurred for paper-money lent. To be sure Congress acknowledged its value equal to its name; but this was done on a principle of policy, in order to prevent the rapid depreciation which was taking place. But money lent in this depreciated and depreciating state, can hardly be said to be lent from a spirit of patriotism; it was a mere speculation in public securities. They hoped, by putting their money in the loan-office, though in a depreciated state, to receive hard money for it by and by. I flatter myself this prediction will never be effected.

The Secretary of the Treasury has offered some alternatives to the creditors, out of which they may make their election; but it seems to me that they, all of them, propose a reduction in the principal and interest, that they may have an annuity of two-thirds, at six per centum, or for the whole sum at four per centum, or they may accept of the other terms. Though this may make a reduction favorable to the public, yet this is not such a reduction as justice, in my opinion, requires; and as the resolution before the committee is intended to make way for the adoption of those principles, I shall vote against it, though I would rather it was passed over for the present, in order to see what is the sense of the House on making a specific provision for the payment of the debt.

Mr. PAGE was glad that the question had been asked the mover of the propositions on the table what was the object of the resolution now under consideration, because it was liable to be misunderstood. But now, he presumed, the answer had satisfied every gentleman's mind.

The gentleman from New Hampshire was pleased to observe, that foreigners were not interested in the late revolution; that what they did was from such motives as demanded our gratitude; but our citizens were deeply interested, and, I believe, if they were never to get a farthing for what is owing to them for their services, they would be well paid; they have gained what they aimed at; they have secured their liberties and their lives; they will be satisfied that this House has pledged itself to pay to foreigners the generous loans they advanced us in the day of distress. If we were to make distinctions adverse to their interests, we could never expect from them a further favor in the future exigencies of this country. But we may also look with confidence at home for loans and services; on such occasions they will be supplied us on the principles of patriotism; the adoption of the first resolution was therefore politic and just, but the motion of my worthy colleague is not necessary. I feel for my fellow-citizens who have gloriously exerted themselves in the salvation of their country by their services in the field, or the supplies which they yielded, as much as any man can do. I acknowledge the debt of gratitude the community owes to those select citizens, and am willing to pay it as far as we possibly can; but they cannot, they will not complain of the deference we have shown to others, whose particular situation merited such regard at our hands.

Mr. SCOTT.--I find myself obliged to consider the Government of the United States in a very different situation, with respect to our foreign and domestic creditors. With respect to the foreign debt, we, the representatives of the United States, are vested with full power, and we are bound in duty to provide for the punctual payment according to the nature of the contract; but when I turn my eyes to the domestic debt, I find myself in a very different situation. I conceive myself a mere arbiter among the individuals of which the Union is composed. A part of the people have a claim upon somebody. I think that claim is against the people at large, and we are not only to provide for the payment of that claim, if just, but to determine whether that claim is just or not. One part of the community applies to us to recover of the other what is due to it; the other says, the debt is too large, it is more than is justly due; you must try and determine between us, and say what part is just, and what is not. This brings clearly into my view the whole subject, as a thing within the power of Congress to new model or modify, if we find that justice demands it; but we have no such authority with respect to the foreign debt. It is very clear to me, that we have the power to administer justice and impartiality among the members of the Union; and this will lead me freely to assert, that we have not only authority, but it is our duty, if, on examination, we find that not more than half the sum that is claimed is justly claimed, to strike off the other half.

Mr. BOUDINOT.--I am glad to see gentlemen bring into view principles on which to determine the great question before us; because, when they are once established, they will enable us to proceed with certainty to a decision. If the principles brought forward by the honorable gentleman from Pennsylvania are just, his arguments are of great weight; but if, on consideration, we shall find that the principles are unjust, then I presume, however cogent the system of reasoning he has founded thereon, it will not prevail. He supposes we sit here as judges to determine the different claims of the creditors of the United States. If we are in that predicament, I agree we ought not to proceed but on full evidence and hearing of those claims. But I have never hitherto been led to consider Congress in this light, nor can I now consider them in any such point of view. I consider the Congress, who entered into these engagements, as complete representatives of the United States, and, in their political capacity, authorized, by the articles of Confederation, to contract the debts for which our public faith is pledged; instead of being judges, or arbitrators, on this occasion, we are parties to the contract; nor is our case varied, by the dissolution of the old Confederacy, because the existing constitution has expressly recognized the engagements made under the former. All debts contracted before the adoption of this constitution, shall be as valid against the United States, under this Government, as under the Confederation. Now is the moment to establish the principle; if the constitution admits the borrowing of money, or paying for supplies, to be a contract, we are one of the parties to this contract, and all idea of being arbiters must vanish. We cannot judge in our own cause. The case will now stand clear; we owe a debt, contracted for a valuable consideration. The evidences of our debt are in the hands of our creditors, and we are called upon to discharge them; if we have it in our power, we ought to consider ourselves bound to do it, on every principle of honor, of justice, and of policy; but as we have not the ability to pay the whole off, nor, perhaps, the whole interest, we must endeavor to make such a modification as will enable us to satisfy every one. Not that this modification shall take place without the consent of the creditors; this would be improper and unjust. Each party is as much to be consulted on this occasion, as it was at the time of the first contract. If, then, Congress is bound by the first contract, no gentleman can say we are judges. If we are parties, what would be the decision before a court of justice? The creditor produces my bond, by which I have bound myself to pay a hundred dollars; I cannot gainsay the fact; no man is allowed to plead that he has made a bad bargain, and that at other times, he could have purchased what he got of the creditor at half the sum he was forced to allow him. The inquiry with the judges is not, whether the debtor made a good bargain or not, but whether he did it fairly and voluntarily. We are in the same predicament if we fairly and honestly received the quid pro quo; we are bound, as parties to the honest performance of the contract, to discharge the debt; otherwise, what avails the clause in the constitution, declaring all debts contracted, and engagements entered into, before the adoption to be as valid against the present Government as they were under the old Confederation? The debt was bona fide contracted; it was acknowledged by the United States; and the creditor received a certificate as to the evidence of his debt. It is immaterial to us what he did with it. I confess, if the original holder was to come forward, and say that he had been robbed of such evidence, we ought not to pay it until the point was ascertained in a court of justice.

Some observations were made to point out a difference between the foreign and domestic debt. I admit there is a distinction, and that in another instance, which has not been mentioned. His Most Christian Majesty, when he first became our important ally, presented Congress with a large sum of money; but this being insufficient to procure us the necessary supply of military stores, a loan was made us from the royal coffers of France. But this also being inadequate, we endeavored to obtain further aid from foreigners. The credit of the United States was so much impaired, as to hold out but little encouragement to individuals to trust us with their money. The French King added another mark of his distinguished attention: he guarantied the loan, and the money was obtained--obtained of the widow and fatherless; of persons whose all depended upon a punctual payment of the interest. On this point I could refer you to letters from our commissioners in Europe, who beg that we may not put them on this business, unless we are certain that the United States will carefully provide for the payment of the interest; because, in case of failure, hundreds must perish for want. This is another motive why we should attend to the performance of our contracts; and I will repeat again, it is what we are called upon to do upon every principle of honor, justice, and policy.

Mr. LAWRENCE.--The observations of the honorable gentleman from Pennsylvania, (Mr. SCOTT,) if I rightly understand them, apply to the principal, and not the interest of the domestic debt. He imagines it to be too large; that is, that the individual who performed services, or rendered supplies during the late war, received evidences of rather too great nominal value; and that, at this period of time, it is necessary to investigate every particular claim, and judge whether the balances are respectively due or not. The gentleman has distinguished between the foreign and domestic creditor on this point; he supposes the foreign debt ought not to be re-examined, because the holders of it are unconnected with our Government. They lent us money, and we are bound according to the precise terms of the contract. Here I agree with him; but that there should be a solid distinction in justice between the foreign and domestic creditor is to me a singular thing. It was observed, that the citizens of America would be well paid for their loans, supplies, and services, by the benefits and profits arising to them by the revolution; but are we to sacrifice the claims of individuals of the community for the advantage of the whole? Who are benefited by the revolution? Every citizen. Then every citizen is bound to contribute his equal part of the expenses attending the procurement. Should those of our citizens who furnished the supplies, or loaned their money, be the only class who are injured? Every citizen is bound to pay according to his ability, because every one has participated in the benefits: then the only question to ask is, whether this discrimination should be made to ascertain or new proportion the debt? This will lead me to inquire whether it is proper for us, after the resolution we passed at the last session, after the resolution we have just now passed, to scale the public debt anew? Shall we say that the evidence carries on its face fraud and deception? I contend we shall not. Why shall we liquidate a debt which is established upon a complete and final settlement? From the face of the evidences arises the demand, and that is the demand we are to make provision for. Shall we go to our officers and soldiers who served during the late war, individually, and say that the balance struck to be due to them is an imposition on the public, when the Government itself has determined that they were entitled to such particular reward? If, at the time those securities were given to them, Government had paid them in money, would any gentleman now contend that their accounts ought to be reliquidated, and every individual called upon to refund a part of what he acquired in conformity to the laws of this country? Certainly no gentleman would contend for such a measure. How is the nature of the case altered from the circumstances of our having been so unfortunate as to pay those worthy men with a certificate in lieu of the money which was due? The nature of the case, I conceive, is perfectly the same; and we are in duty bound to make a full compensation. The face of the paper expresses what that is, and it is to be our guide; the demand surely is not to be lessened.

Mr. JACKSON said there were, most surely, principles on which to ground a discrimination betwixt a foreign and domestic creditor; if there was no other, there was this, that the domestic creditors are those that are bound to pay the foreign creditors their demand; they ought, consequently, to do justice to others, by a punctual payment, before they require a discharge of their own claims.

Mr. AMES did not conceive it material to inquire whether there be an equal obligation on the people of the United States to pay their foreign and domestic creditors, when they meant to pay both; but if it is intended to reduce the principal of either, it will lead us into a discussion of the principles on which such a measure ought to be founded. The honorable gentleman from Pennsylvania (Mr. SCOTT) probably intends by the amendment to have a reduction of the debt; I have, said he, so much respect for the good sense and upright intentions of that honorable gentleman, that I will not impute to him unworthy motives; nor do I believe that he governs his conduct in private life by maxims which I suspect to be contained in the amendment now before us. I would not be understood, by any means, to convey an improper reflection upon the opinions of any one. The science of finance is new in America; a gentleman may therefore propose the worst of measures with the best intentions. What, let me inquire, will be the pernicious consequences resulting from the establishment of this doctrine? Will it not be subversive of every principle on which public contracts are founded? The evidences of the debt, possessed by the creditors of the United States, cannot, in reason, justice, or policy, be considered in any other light than as public bonds, for the redemption and payment of which the property and labor of the whole people are pledged. The only just idea is, that when the public contract a debt with an individual, that it becomes personified, and that with respect to this contract, the powers of Government shall never legislate. If this was not the case, it would destroy the effect it was intended to produce; no individual would be found willing to trust the Government, if he supposed the Government had the inclination and power, by virtue of a mere major vote, to set aside the terms of the engagement. If the public in such a case is, as I have said, personified, what conceivable difference is there, except in favor of the creditor, between the public and an individual in the case? If, then, the public contract is a solemn obligation upon us, we are bound to its true and faithful performance. What is the object for which men enter into society, but to secure their lives and property? What is the usual means of acquiring property between man and man? The best right to property is acquired by the consent of the last owner. If, then, an individual is possessed of property, in consequence of this right, how can Government, founded on this social compact, pretend to exercise the right of divesting a man of that object which induced him to combine himself with the society? every gentleman may determine this question by his own feelings. Shall it be said that this Government, evidently established for the purpose of securing property, that, in its first act, it divested its citizens of seventy millions of money, which is justly due to the individuals who have contracted with Government! I believe those gentlemen, who are apprehensive for the liberties and safety of their fellow-citizens, under the efficiency of the present constitution, will find real cause of alarm from the establishment of the present doctrine. I have heard, that in the East Indies the stock of the labor and property of the empire is the property of the prince; that it is held at his will and pleasure; but this is a slavish doctrine, which I hope we are not prepared to adopt here. But I will not go further into a consideration of the idea of discrimination. I will ask, though, is this country ever to be in a settled and quiet state? Must every transaction that took place, during the course of the last war, be ripped up? Shall we never have done with the settlement and liquidation of our accounts?

Mr. LIVERMORE.--The arguments advanced by the gentlemen from Massachusetts and New York prove too much, and therefore prove nothing. That the late Congress had, at all times, from their first institution, the power to contract debts, for the benefit of the United States, cannot be denied; and that we are authorized to pay such debts, is equally certain. But this by no means contravenes the opinion of those gentlemen who think, that the whole may be properly considered and discharged at the rate which justice requires; for the same argument which is urged for the payment of the public securities at their nominal value, might be urged in favor of paying off the Continental debts of credit, according to the sums expressed on the face of them. They were issued with as much confidence, and were received with as much reliance on the public faith, as any species of securities whatever; yet, it seems to be given up on all hands, that the owners of the old Continental paper bills ought not to be paid according to their nominal value. Perhaps it may be said, on comparing them with the loan-office certificates, that the United States had not the benefit of that money; but had they not the value of it? It will be answered, that when the money was first issued, Congress had nearly the value for it; but afterwards the money greatly depreciated, and they had not the full value for it, yet the obligation to pay it is as explicit as words can make it. No advocate will be found for making all that money good. It has been thought proper, and it is just, that it should be reduced from its nominal value; if it is reduced on a scale of one hundred for one, the holders of it, I dare say, would cheerfully receive that sum. If the United States then had value for it, and if they had not value for the certificates, who can doubt of the justice of reliquidating, and duly ascertaining the public debt? All I contend for is this, that the present Government pay the debts of the United States; but as the domestic part of the debt has been contracted in depreciated notes, that less interest should be paid upon it than six per cent. Six per cent. was the usual interest upon the certificates when they were issued by Congress; but if the possessor has received no part of this six per cent. until this time, that now the principal and interest be consolidated into one sum, hereafter to bear an interest of three or four per cent.; then those citizens, who now stand as creditors of the Union, will find that part of their property has been the most productive of any, much more productive than the property of the citizens of the United States has generally been. Those who lent their money to individuals before and during the late war, generally lost or suffered by the depreciation some three-quarters of the capital; nay, some thirty-nine fortieths. But is this the case of the domestic creditor of the United States? No! he will preserve his property, through the chaos of the revolution, and be put now in a more eligible situation than he was at the time when he loaned the money. The capital sum which he lent is now increased, and very rapidly increased, for six per cent. is a very large interest. He will now receive 160 dollars for his 100, and putting that into the funds, at three or four per cent. he will find it more productive than any other method in which he could employ his money; for, I contend, that neither improved, nor unimproved lands, will give an interest near half of what the public creditor will receive. People who have held real property have sunk, with the taxes, and other losses, the greatest part of it; but the public creditor has let his run through the confusion of the revolution, and nevertheless gets it returned to him safe; and, so far from being impaired, that he has prodigiously accumulated, not only in a manner superior to the property of his fellow-citizens, but superior to the foreigner who lent his money at four per cent. Justice and equity require, on the behalf of the community, that these people be content with reasonable profit. They ought not, therefore, to receive, on a funded debt, so much as six per cent.; whether three or four, or something between three and four, would be a proper sum, I shall not pretend to determine. But I consider it a proper question for this committee to consider, in justice to those who are to pay, as well as to those who are to receive; nor do I believe the domestic creditors would be dissatisfied with it, provided they were sure of receiving this annual interest; for their debts, on such a footing, would be better to them than if they were established on an extravagant plan that could never be effected, but which would be likely to throw the nation into confusion. Every body has suffered more or less by the depreciation, but the public creditors very little, in regard to that part of their property which they had deposited in the hands of Government: it is true, that it has slept; but it is now waked up to some purpose.

Mr. SCOTT.--A great deal has been said on a great principle that must be attended to in some stage of this business; but gentlemen have been led into a more extensive discussion on the doctrine of discrimination than I had any idea of when I proposed the amendment. It has been urged by some of the gentlemen, that however just my principle is, that the Legislature is in the quality of an arbitrator, yet we cannot adopt the amendment; others again have said, that the debt is a contract between the Government and the individual, and that we being parties we cannot be judges; for it is contrary to the principles of the law, that we should be judges in our own cause. If, in national transactions like this, interesting to our citizens only, the Government is to be supposed one party, and the individual the other party, I would ask the gentleman who is the judge? Can two parties exist in a well organized Government to dispute about property, and have no judge? The very idea must induce the gentleman to abandon his ground. It has been said, as the foundation of an opinion, that there is a great similitude between a certificate and a bond that is brought into court to demand payment upon; that no opposition can be made; that no plea can be entered; but I would wish to ask the gentleman who made the remark, as a professional man, whether the want of consideration would not be a good plea? In Courts of Equity, relief can be given against prima facie evidence.